Do You Know How to Create Passive Income?

August 20, 2025

Let me ask you something that could change your life: Do you know how to create passive income?

Not “make money while you sleep” in a sketchy, too-good-to-be-true way.

I’m talking real, practical, honest-to-goodness income streams that take effort upfront but keep delivering even when life gets busy… like when you’re helping with homework, cooking dinner, or squeezing in a 20-minute workout before the toddler wakes up.

If you’ve ever thought, “There’s got to be a better way,” you’re not alone.

I used to feel the same.

I was juggling work, motherhood, and dreaming of more freedom, more time with my kids, and less time stuck in the daily grind.

That’s when I learned this truth: Passive income isn’t about working less. It’s about building smarter.

Let’s break it down.

What Is Passive Income, Really?

Passive income is money you earn with minimal daily effort. You usually do the work once early on, like creating a digital product or setting up an investment, and then it pays you again and again.

Here’s the truth: it’s not instant, and it’s not magic.

It’s more like planting a garden.

You till the soil, water the seeds, and wait.

And then, boom, flowers bloom. Or in this case, money comes in while you’re at soccer practice.

So how do you start?

1. Invest in the Stock Market (the Lazy Yet Effective Way)

If the idea of picking stocks sounds as thrilling as organizing your junk drawer… good news: you don’t have to.

Enter: index funds. They’re like the crockpot of investing: set it, forget it, and let time do the work.

Index funds are bundles of hundreds (sometimes thousands) of stocks. Instead of betting on one company like Apple or Google, you invest in all of them at once, spreading your risk and riding the overall growth of the market.

And when you invest regularly (even small amounts), you’re building passive income through dividends and long-term capital gains. No day trading. No constant checking. Just smart, steady growth.

Success Snapshot:

How do I know this? I’ve done it myself, and it’s fundamentally changed my life in a positive way.

How?

By consistently investing in low-cost index funds and living well below my means. No crypto. No hype. Just good old-fashioned compound interest doing its thing. Did it happen fast? It depends on your definition of fast. But within a few years, it can make a large impact, with life-changing results in as little as 5-10 years.

Pro tip:

Look for low-fee index funds from trusted platforms like Vanguard (VTSAX), Schwab (SWPPX), or Fidelity (FXAIX). Use an IRA or a brokerage account and automate monthly deposits—$50, $100, whatever you can swing.

Over time, this absolutely becomes passive income. Especially when you start getting dividend payments just for holding your investments.

Learn More:

Investing 101: How To Invest and Grow Rich

2. Sell Digital Products on Etsy

This is one of my favorite low-effort, high-upside ideas if you’re looking for something a little more active and you enjoy creating things.

How does it work?

You create something once (think: planners, checklists, chore charts, wall art, party games, etc.), list it on Etsy, and customers can buy and download it instantly. No shipping. No inventory.

Success Snapshot:

How do I know this? Again, I’ve done it myself, and am part of a cohort of many people who have achieved amazing results with this strategy. I’ve made as much as $17,000 in a single month selling digital products on Etsy.

If you’re a busy mom with a knack for design, Canva, or even just organizing chaos, this one’s for you.

>>Free Workshop: Earn Money Selling Printables<<

3. Sell Print-on-Demand Products on Etsy

If you love cute mugs, funny t-shirts, or aesthetic tote bags, this one’s going to be your jam. With print-on-demand (POD), you don’t touch inventory, deal with shipping, or have a garage full of boxes.

Here’s how it works:

You design a product (using free tools like Canva or Creative Fabrica).
Upload your design to a production partner like Printify or Gelato.
List it on Etsy.
When someone buys, the production partner prints and ships it automatically. You collect the profit.

It’s like running a merch shop without ever going to the post office.

Success Story:

Emily Odio-Sutton, a mom of two, made over $500,000 selling print-on-demand products on Etsy in just two years. Her best sellers? Personalized gift items like journals, ornaments, candles, and tote bags. She didn’t use social media or have a big following. Just smart SEO, great design, and niche targeting. I took her course recently, and it really delivers!

Hot tip:

Products that make great gifts—especially for weddings, baby showers, or holidays, tend to sell year-round. Personalization is huge in this space.

Want to try this? Start by designing a few products, test different niches (teacher gifts, pet lovers, bridesmaids), and see what clicks. Once you find a winner, scale it up.

4. Publish Low-Content Books on Amazon KDP

Amazon Kindle Direct Publishing (KDP) lets you create and sell books—without ever printing them yourself.

“Low-content” books are things like journals, planners, coloring books, and logbooks. They don’t require much writing, but they do require creativity and understanding of your niche.

💡 Success Story:
Rachel Harrison-Sund, a business owner and mom, built a thriving business with low-content books—raking in six figures per year. She now teaches others how to create these books using simple tools like Canva.

Best part? Once your book is uploaded, Amazon handles the printing, shipping, and customer service.

Talk about mom win.

>>FREE WEBINAR: 3 Steps to Publishing Your First Low-Content Book in Less Than a Day>>

5. Affiliate Marketing

Affiliate marketing is recommending products you love and earning a commission when someone buys using your link.

And no, you don’t need a giant following.

Start with products you actually use and trust. Maybe it’s a budgeting course that helped you get out of debt, a planner that changed your life, or an online business tool you can’t live without.

My Tip:

In my emails and blog posts, I naturally weave in affiliate links, like when I talk about the tools I used to grow my Etsy shop or the course that finally taught me how to stop trading time for money.

If you have a story and a recommendation, you can make affiliate income. No pushy sales tactics required.

What No One Tells You About Passive Income

Here’s the part people don’t always say: Passive income requires active effort, at least in the beginning.

You’ll need to learn, experiment, probably fail a little, and keep going. But if you’re tired of feeling like your income is capped by your time or energy, then building a few passive income streams might just change your life.

I’m living proof. So are the thousands of other women building freedom, flexibility, and financial peace one digital product or Amazon listing at a time.

Start Where You Are

You don’t need to quit your job tomorrow.

You don’t need to have it all figured out.

But you do need to believe that you can learn something new, test a few ideas, and create small systems that work for you, even if you only have 5 hours a week.

Start by choosing one thing from this list. Go all in for 90 days.

Then watch what happens.

And hey, if you ever need help or a pep talk, I’m just an email away.

Still here? Check out this Blueprint for How to Create Passive Income

There are a ton of ways to quit your 9-5 job and make money from home, but if you’re interested in learning more about how to do it on Etsy, check out The Shockingly Simple Guide to Selling Passive Income Products on Etsy. This free, in-depth guide provides a deeper blueprint for passive income, helping you learn exactly how to create digital products on Etsy!

LEARN MORE:

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Disclosure: This post may contain affiliate links, meaning if you decide to purchase via my links, I may earn a commission at no additional cost to you. See my disclosure for more info.

P.S. The information provided on this blog about how to create passive income is for educational and entertainment purposes only. It should not be construed as financial advice. The content is not intended to be a substitute for professional financial or tax advice. You should always consult with a qualified financial advisor or tax professional before making any financial decisions. The author and publisher of this blog make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability, or availability with respect to the blog or the information, products, services, or related graphics contained.

Rachel Jimenez

Rachel Jimenez is passionate about personal finance, passive income, and positive psychology. She is known for being a top digital product seller on Etsy, and loves sharing side hustle and money tips so people can reach financial independence and live the life of their dreams.

How To Build Passive Income

There’s a quiet misconception about how to build passive income that refuses to die. That the people pulling it off are somehow different. Smarter. Earlier. Braver. Richer. Better positioned. They’re not. Most of them are just… normal. Busy. Slightly skeptical. Often late to the party and unsure if it’ll even work. That’s what makes their stories interesting. Because passive income, when you strip away the hype, isn’t built by superheroes. It’s built by people who decided to stop waiting for perfect conditions and started using what they already had. I know, because that’s exactly how I started. My Passive Income

Rusted metal gate chained and locked in a rural field, symbolizing barriers to passive income and financial growth.

Why Money Isn’t the Barrier to Passive Income (and What Is)

Let’s clear something about passive income up right away. If you don’t have passive income yet, it’s probably not because you don’t have enough money. That’s the story we tell ourselves because it’s convenient. Money is an easy villain. It lets us delay action without confronting the harder stuff. “I’ll start once I have more cash.”“I just need a little runway.”“I’d do this if money wasn’t so tight.” I believed that too. And it kept me stuck far longer than I care to admit. Because once I actually started building passive income, it became painfully obvious: money was never the

Person using a calculator and counting cash at a desk, representing strategies to build passive income through budgeting and financial planning.

Build Passive Income Even If You’re Broke

Nobody admits this part about building passive income out loud, so I will. Most people who want passive income aren’t lazy. They’re exhausted. They’re mentally juggling daycare costs, groceries that somehow doubled, and a job that pays fine but somehow never feels like enough. They don’t want to be rich-rich. They want room to breathe. And when you’re in that place, most passive income advice sounds… detached from reality. “Just invest.”“Just start a business.”“You just need to outsource.” Cool. With what money? And what time? I didn’t start building passive income because I was inspired. I started because I was

Mother and child enjoying a day at the fair, child with face painted like a tiger, symbolizing joy in everyday life while securing passive income from home.

A mom turned passive income entrepreneur makes 6-figures in passive income from home. Here are the top 5 tips for getting started with very little money.

I had always dreamed of working for myself and making passive income from home, but it took years of toiling until I finally figured it out. Then, on a whim, I decided to learn how to sell digital products on Etsy. Now, I’ve made over $500,000 in passive income from home. Here are my 5 tips for getting started making passive income from home with very little money. 1. Start with one passive income source and focus The most important tip I can give anyone is to start with one thing and focus on it. I was a constant dabbler